LAHORE: Pakistan’s rice exports faced a stark reversal, showing a sharp year-on-year decline of 39 per cent during the initial four months of the current fiscal year (4MFY26).
This sudden drop has put a considerable burden on the country’s overall export performance, underscoring the instability in the global commodity market and the threats posed by geopolitical trade factors. One of the primary causes of this decline is linked to a neighbouring country lifting its restrictions on rice exports, which has led to an influx in the international market and intensified competition that has diminished Pakistan’s market share and pricing authority.
The quarter-by-quarter analysis of the trend over the past decade reveals the extent of this setback. In 4MFY25, rice exports reached a remarkable US$907 million, setting a record high that followed a robust US$675 million performance in 4MFY24. This period of significant growth was primarily driven by favourable global conditions, including the lack of major competitors.
However, the most recent data for 4MFY26 indicates a severe decline to only US$553 million. This performance not only signifies a 39pc drop from the previous year’s peak but also reflects an 18pc decrease when compared to the pre-peak figure of 4MFY24, indicating that the sector has lost substantial ground.
Examining the long-term trend reveals that 4MFY25 was a deviation, suggesting that the current downturn represents a return to — or even a dip below — the long-term growth path. For example, rice exports steadily increased from US$381 million in 4MFY17 to US$501 million in 4MFY19. Exports then experienced robust years in 4MFY20 (US$684 million) and 4MFY24 (US$675 million), prior to the remarkable peak. The current figure of US$553 million is more aligned with the values recorded four to five years ago, specifically US$546 million in 4MFY21 and US$592 million in 4MFY22.
This analysis highlights that the recent export performance is not simply a correction from a high baseline but indicates significant competitive pressures. The impact of this considerable decline is a noticeable adverse effect on the national balance of payments.
Rice stands as one of Pakistan’s key export products, and a nearly 40pc drop in its foreign exchange earnings exerts tremendous pressure on achieving the overall export target for the fiscal year. While the industry greatly benefited during the period of competitors’ restrictions, the immediate removal of those restrictions required a rapid adjustment of Pakistan’s export strategy.
The value of rice is also an important factor, affecting exports. The pressure on prices was reflected in the export prices realised, which saw a notable decline starting from mid-2024. Prices fell sharply, remaining in negative Year-over-Year (YoY) territory for the majority of the period leading up to 4MFY26, reaching lows below US$400 per ton earlier in 2025 before a slight recent recovery.
Despite sliding rice exports, there is a glimmer of hope for the remaining months of the year. According to Shahzad Ali Malik, a leading rice exporter, Pakistan’s rice exports are now set for improvement with the paddy arrival in the ongoing season and processing of the new crop. However, the road to recovery is laden with obstacles. The re-entry of India into the rice export market and ongoing competition from Vietnam present significant challenges, compelling Pakistani exporters to compete fiercely on both price and quality.
Additionally, Malik, who pioneered a farm-to-fork rice chain, continued to say that the negative effects stemming from the closure of traditional trade routes with Afghanistan and its potential ripple effects on exports aimed at Central Asian countries add further complexity. Despite these global and regional challenges, there remains a strong glimmer of hope: favorable yields, especially for non-Basmati rice varieties in Sindh, are expected to increase supply.
